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Increase the Development of New Housing that is Affordable 

To create and sustain a healthy housing market, Minnesota will need 182,000 new housing units in Minnesota through 2035 across all types and price points; however, the greatest need is for housing that is affordable for low-income families. Only 24% of renter households with an income at or below 30% of the area median income (AMI) are in a home they can afford.  The month-supply of homes selling for $300,000 or less is only 1.1 months, when a five-month supply is considered a healthy and balanced market.  Expanding the supply of housing that is affordable is critical because most lower-income households just need an affordable place to live.

Key Metrics

Number of new rental units funded by Minnesota Housing with rents affordable to households with incomes at or below 30% of the area median income (AMI), and between 31% and 50% of AMI (coming soon)

Number of new owner-occupied homes funded by Minnesota Housing selling for $300,000 or less (coming soon)

Number of new owner-occupied and rental homes financed by Minnesota Housing in Greater Minnesota communities with substantial job growth (coming soon)

Actions

Streamline and Simplify Programs

Streamline and Simplify Programs

Increase Funding

Increase Funding

  • Effectively use and leverage existing funding, particularly the funds for new construction that the 2023 Minnesota Legislature provided
  • Demonstrate the impact that housing investments have on people’s lives and community well-being, particularly the large investments funded by the 2023 Minnesota Legislature
  • Work with Congress and the state legislature to increase funding and expand the uses of funding; for example, to develop 2- to 30-unit buildings, which currently lack a good funding source
  • Encourage local governments to invest in housing
  • Partner with and encourage businesses and employers to invest in housing, recognizing that housing affordable for their workforce is a competitive advantage
Innovate and Reduce the Cost of Housing Production

Innovate and Reduce the Cost of Housing Production

  • Partner with others to advance technology and innovation to increase housing construction productivity, which could include modular or panelized construction and even 3-D printing
  • Support strategies to increase the number of contractors and people working in the building trades
  • Review and adjust our design and construction standards to find ways to reduce costs but acknowledge and sufficiently fund projects when our standards, such as energy standards, add upfront costs
  • Focus on life-cycle costs, including durability, maintenance, utility and environmental-impact costs over time
  • Collaborate with other state agencies to incentivize the development of new housing and to reduce the cost of development; for example, working with the Department of Labor and Industry on prevailing wage issues
Grow the State’s Capacity to Develop Housing that is Affordable

Grow the State’s Capacity to Develop Housing that is Affordable

  • Expand the pool of housing developers by:
    • Building the capacity of new developers
    • Providing technical assistance to help them submit competitive applications for funding
    • Helping them find ways to finance pre-development costs
  • Support Indigenous, Black and developers of color to enter the market and succeed, collaborating with the Department of Employment and Economic Development on their developers of color program
  • Facilitate and support partnerships to build the capacity of smaller and rural communities to develop new housing 
Increase Housing Choice

Increase Housing Choice

  • Encourage and/or fund the development of the full spectrum of rental and homeownership housing at various price points in all communities, including creating affordable options in higher-income communities
  • Encourage local governments to evaluate their policies and regulatory costs to promote a full range of housing options in their communities, including duplexes, triplexes, fourplexes, condominiums, townhomes, accessory dwelling units, cluster homes, cottage homes and other higher-density housing

Expand the strategic plan table of contents to navigate the plan's strategic objectives and their dashboard metrics.

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